Wills and Estate Planning

What Is A Special Needs Trust?

If you need to provide for long-term care of someone with special needs, there are additional considerations that will affect them after your passing.

Estate Planning - Trusts and Estates

Learn More About Special Needs Trusts and Estates

If you have a disabled person in your life that you want to ensure is taken care of after you die, you may benefit from some research regarding estate planning. Not only do you want to be sure that your assets are used specifically to care for the needs of a physically or mentally disabled adult or child, but you need to do so in a way that won't adversely affect their government benefits such as Social Security. This is where a special needs trust can help.

If you leave assets or designate income to be distributed to a disabled individual in your will after you die, that additional income or assets may exceed the financial guidelines of certain government sponsored programs. If they do, the individual may lose all or some of their government benefits. For this reason, it is especially important to prepare and execute a special needs trust as soon as possible or ideally when creating your will.

How it works

A special needs trust works in a way that leaves the assets in the ownership of the trust itself and not the actual beneficiary. Therefore, it is the trust that provides the benefits to the individual who needs them. When set up correctly, a special needs trust can help prevent a disabled person from losing their government program benefits.

A special needs trust can hold real estate, cash, stocks and other various assets. The benefits of a life insurance policy can also be paid through the use of a special needs trust, again, ensuring that the benefits go directly to the person who needs them the most.

Summary

It's important that your special needs trust is set up correctly and meets certain legal and state requirements. For this reason, it is to your benefit to speak with an experienced estate planning attorney. For more information on estate planning, visit Protective's Estate Planning Learning Center.

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All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and is meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax‐related decisions. For information about Protective Life and its products and services, visit www.protective.com.

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Estate Planning

Do you have a special needs child or adult who depends on you for financial support? Do you want to ensure that their needs are taken care of long after you are gone? As part of your estate planning, you may need to consider establishing a special needs trust. Get a better understanding of what a special needs trust is and how it can better serve special needs individuals that you wish to bequeath your assets to. For more information, visit our learning center.

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